Neil Young and The Perils of Wealth, Timing and Divorce


News outlets have been abuzz with word that Neil Young has filed for divorce from his wife, Pegi, to whom he has been married for 36 years. Together, they have one son, an adult who suffers from cerebral palsy. In his petition, Neil offered to support their adult son but not to support his wife. Pegi, not surprisingly, in her pleadings seeks child and spousal support.

It remains to be seen whether this divorce will become public and ugly, but it will be costly. Neil and Pegi married in 1977, at the height of Neil’s popularity as a solo artist. But in the ensuing years, Neil would sell millions of records, many recorded after the marriage; he would tour and make millions, often with Pegi as a background singer; they started a charitable foundation together; and Neil also developed a new technology he patented called “Pono,” which could be the “high def” version of the iPod. Together Neil and Pegi own multiple homes, including a large ranch.

Given the length of the marriage, the need for Pegi to care for their disabled son, and the large disparity in income, Pegi will certainly receive maintenance and child support. But the more interesting questions concern his income and their lifestyle together over all these years.

Neil may have written “A Man Needs a Maid,” but he will not be able to treat Pegi like one in family court. Pegi is entitled to half of the income Neil earned during the marriage – a substantial sum – that includes royalties on record sales, concert proceeds and other ventures. While Pegi may not have helped developed Pono, she could claim that her support in caring for their son and making a home, where Neil also maintained a recording studio, enabled Neil the ability to create Pono. Pegi may in fact be a partner in one or more corporations related to the development of the technology, but if she is not, she still has an interest because Pono “birthed” during the marriage. If Pono turns out to be the next iPod, Pegi would want a stake in the future of that technology.

Could Neil have taken steps to limit Pegi’s claim to marital property? Yes, if the parties entered a prenuptial or postnuptial agreement. But assuming such a document exists, the family court would still have to find it not unconscionable, which means it has to be fair and not completely one-sided.

Neil may not like to share (ask many of the musicians who have worked with him over the years), but in this divorce he will have to pay significant sums to Pegi in addition to dividing the marital property – he has given her a lavish lifestyle to which she has grown accustomed and may continue to expect to enjoy.

It will be interesting to see how this particular celebrity divorce unfolds. Stay tuned.

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